Location: Newark, NJ | Metro: Bergen-Passaic, NJ HUD Metro FMR Area
Based on 1% Rule: A+ (≥1.5%) | A (≥1.2%) | B (≥1.0%) | C (≥0.8%) | D (≥0.6%) | F (<0.6%)
| Unit Size | Monthly FMR |
|---|---|
| Studio | $2,340 |
| 1 Bedroom | $2,640 |
| 2 Bedrooms | $3,190 |
| 3 Bedrooms | $3,970 |
| 4 Bedrooms | $4,560 |
| 5 Bedrooms | $5,290 |
| 6 Bedrooms | $5,925 |
| 7 Bedrooms | $6,399 |
| 8 Bedrooms | $6,719 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 1BR | $2,640 | $400,326 | 0.66% | D |
| 3BR | $3,970 | $1,136,965 | 0.35% | F |
| 4BR | $4,560 | $1,444,229 | 0.32% | F |
| 5BR | $5,290 | $1,919,708 | 0.28% | F |
U.S. Census Bureau data (2024)
The Section 8 cap rate analysis for ZIP code 07043 reveals a significant gap between the federal market rent (FMR) and the market rent, impacting potential investment returns.
With an annualized 2BR FMR of $2860 for FY 2024, the implied gross yield for a property in ZIP 07043 is calculated as follows:
In contrast, using the ZORI (Zillow Observed Rent Index) market rent figure of $3,340 per month, the annual rent would be $39,960, resulting in a gross yield of about 2.9% when compared to the same median home value.
Given the 14.7% renter density in ZIP 07043, it is important to consider the likelihood of securing tenants willing to pay the market rent versus those eligible for Section 8 housing assistance. The N/A-day DOM (days on market) suggests that rental listings may move quickly once they are posted, indicating a potentially competitive rental market. However, the limited availability of data on DOM makes it difficult to draw firm conclusions about the speed at which properties are leased.
The gross-yield comparison clearly shows that relying on market rents rather than FMRs yields a better return for investors. However, the actual feasibility of achieving these rates depends on the local demand for rental properties and the specific requirements of Section 8 participants. For landlords and small-portfolio investors, understanding the dynamics of both FMR and market rents is crucial for making informed decisions about the profitability of properties in ZIP 07043.
Data Sources: FMR data from HUD (2027). Median home prices from Zillow (2026-07-31). Demographics from U.S. Census (2024).
About FMR: Fair Market Rent (FMR) is used to determine payment standards for the Section 8 Housing Choice Voucher program, initial renewal rents for some expiring project-based Section 8 contracts, and rent ceilings for HOME Investment Partnerships.